STAND

STAND. COM. REP. NO. 603

Honolulu, Hawaii

, 2005

RE: H.B. No. 1434

H.D. 2

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committee on Consumer Protection & Commerce, to which was referred H.B. No. 1434, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO RENEWABLE ENERGY,"

begs leave to report as follows:

The purpose of this measure is to facilitate implementation of the renewable portfolio standard law, as set forth in Act 95, Session Laws of Hawaii 2004, by:

(1) Providing clarification on the kinds of events that are to be considered outside a utility's control in meeting the standard;

(2) Referring to penalties and alternate compliance mechanisms as a potential part of the utility ratemaking structure to be developed by the Public Utilities Commission (PUC); and

(3) Requiring a study of "green" power pricing.

The Hawaii Solar Energy Association, Sierra Club, Hawaii Chapter, Inter-Island Solar Supply, and Honolulu Seawater Air Conditioning, LLC, submitted testimony in support of this measure. The Division of Consumer Advocacy of the Department of Commerce and Consumer Affairs submitted testimony in support of the intent of this measure. Hawaiian Electric Company, Maui Electric Company, and Hawaii Electric Company, opposed this bill with amendments. PUC commented.

Your Committee finds that this bill provides PUC with guidance on implementing the State's renewable portfolio standards, which are designed to increase the use of renewable energy resources in the generation of electricity, and reduce the State's dependency on fossil fuels.

Your Committee has amended this bill to:

(1) Remove limits on PUC's discretion to administer the renewable portfolio law, by:

(A) Including language providing that the circumstances that could be considered by PUC to be outside of the electric utility company's reasonable control are not limited to the examples given in the bill; and

(B) Removing language in section 269-95, Hawaii Revised Statutes, that described the kind of utility ratemaking structure that the PUC is to develop by December 31, 2006;

(2) Changing the effective date to July 1, 2099, to facilitate further discussion of this matter; and

(3) Making technical, nonsubstantive amendments for clarity, consistency, and style.

As affirmed by the record of votes of the members of your Committee on Consumer Protection & Commerce that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1434, H.D. 1, as amended herein, and recommends that it be referred to the Committee on Finance in the form attached hereto as H.B. No. 1434, H.D. 2.

Respectfully submitted on behalf of the members of the Committee on Consumer Protection & Commerce,

		____________________________ KENNETH HIRAKI, Chair